Facebook Closes Out 2013 With Record Earnings

By Chris Preimesberger |
Posted 2014-01-29

It's hard to figure what moves Wall Street investors sometimes. For example, earlier this week, Apple announced positive earnings results plus the fact that it sold 51 million iPhones, a quarterly record. The stock spiraled downhill and hadn't leveled off by late Jan. 29.

Then, Facebook on Jan. 29 released a similarly positive earnings report, and its stock shot upward by more than 12 percent—from $53 to $60—in after-hours trading.

Facebook's numbers surpassed analysts' expectations, with revenue increasing in Q4 2013 to $2.59 billion from $1.59 billion a year earlier. It was the 10-year-old company's best-ever financial quarter.

Advertising revenue was tabulated at $2.34 billion, a whopping 76 percent increase year over year. The key to that big move: mobile ad revenue accounted for about 53 percent of the advertising total in the quarter.

Revenue for calendar and fiscal year 2013 was $7.87 billion, a substantial increase of 55 percent over 2012.

Facebook set out in 2012 to attack the advertising-on-mobile devices market, and results are clearly showing less than 12 months later. The company's mobile advertising strategy, which some analysts believe should have been in place before it went public in May 2012, is now beginning to create some real income.

Facebook said its number of mobile active users was up 39 percent year-over-year to 945 million as of Dec. 31, bypassing analysts' expectations of 919 million.

CEO and co-founder Mark Zuckerberg said on the conference call that "people are engaging more; millions more are hitting 'like' than in the past. Our main goal is to connect the world and build the knowledge economy."

Zuckerberg said that in 2014 Facebook will focus on working with mobile operators to achieve that mission.